How a Class Action Lawsuit Works: Interview with Berger Montague

When facing massive issues with companies, consumers often find that the best way to seek justice is to file a lawsuit. However, a consumer lawsuit is sometimes harder to bring to court as an individual, whereas a class action lawsuit may get higher chances.

Power in numbers is the idea.

What is a class action lawsuit? How does a class action lawsuit work? What are the benefits for a consumer?

Michael Podolsky, a CEO of PissedConsumer.com, invited Amey J. Park, a Berger Montague associate, to a video interview to talk about consumer class actions. Berger Montague is one of the leading consumer class action law firms with over 50 years of experience in handling class action lawsuits.

Watch this video interview to learn more about class actions and how they may help consumers resolve their issues.

Below is a brief summary of an interview with Amey J. Park and her answers to top class action FAQs:

1. Introduction
2. What is a class action lawsuit?
3. Who is lead plaintiff in a class action?
4. Are there benefits for a lead plaintiff?
5. How often do class actions get settled?
6. What is a consumer class action settlement?
7. What determines a valid class action lawsuit?
8. How to choose a firm?
9. How websites like PissedConsumer help?

Introduction

Michael Podolsky: Hi guys. I'm talking with Amey Park today who has been working with Berger Montague, one of the largest consumer class action law firms. Amey has graciously agreed to talk to us about consumer class actions, what it means, and educate us on what is a good class action, what is not a good class action.

On the PissedConsumer website, we often hear, "Hey, I want a class action right now. I have a damaged product." Well, not every event requires a class action and that's some of the questions that we're going to be discussing with Amey today.

Amey J. Park: My name's Amey Park. I'm an associate at Berger Montague. I've been with the firm for a little over a year-and-a-half. And before that, I was a general commercial litigator. So I've been a litigator for seven years now. And recently, in the past couple of years, came to Berger Montague to focus on plaintiffs' consumer class action litigation.

What Is a Consumer Class Action Lawsuit?

Mike: What is a consumer class action lawsuit?

Amey: Yes, that's a great question. Let me start by distinguishing class actions from other litigation. Class action is basically a tool that the courts can use that fashion for litigation in courts where, what it sounds like…

...a lot of people can join together as a class and pursue a lawsuit in a collective group because individuals most often don't have the time or resources or access to legal help to be able to litigate individual claims on their own.

So class actions are a tool used in the courts where, if the court approves a class, then this group of consumers can proceed in litigation and possibly settlement, if settlement is reached as a group. Power in numbers is the idea.

And what differentiates consumer class actions from other class actions is what it sounds like. What we do, we investigate and bring lawsuits on behalf of general individuals, but sometimes entities as well, anything having to do with the consumer industry. So it could be a defective product, a defective product that you use in your home. It could be a defective car, it could be a data breach case, it could be a service contract with your bank or your cable provider. So really anything where a consumer is being injured or harmed in some way, are the class actions we bring.

And again, to distinguish class actions from other cases, in a lot of ways they're not different. An individual could bring an individual claim for a defective blender, but that's pretty expensive for an individual to do that.

It's pretty expensive for an individual to hire a lawyer to sue a big company because your blender stopped working after two months or the lid leaks so you just can't use it anymore. So in that respect, we bring proposed class actions.

We start litigation with a proposed class and then as we move forward in litigation, we basically fight out in the courts to ask the court to look at our facts and our litigation and say, "Yes, these claims that all these thousands of people have or hundreds of people have, are alike enough that it makes sense to go forward in this litigation as a class."

So until that happens, until a court certifies a class, whether it's in litigation or for the purposes of settlement, there isn't a court-approved class yet. And that's another distinction between individual lawsuits and class actions. In an individual lawsuit, you obviously wouldn't have that step where a court looks at a big group of people and says, "Yes, it makes sense for you to proceed as a big group."

Who Is the Lead Plaintiff in a Class Action Lawsuit?

Mike: So Amey, thank you. Please tell me what are the players in the class-action lawsuit? There are lead plaintiffs also known as named plaintiffs, there are class members and there are members of the general population. So who is the lead plaintiff or name plaintiff as you speak?

Amey: Yes, that's a great question. So as I was saying, one thing that is different about class actions, as opposed to individual litigation is there comes a point where the court has to decide and approve who is a class and the contours of what the class is.

Until that time there isn't actually a certified class yet, but before we get to that stage, to start a lawsuit, a proposed class-action lawsuit, we as class action lawyers need to find someone who is a representative, a named plaintiff. And that person is exactly what it sounds like.

That person stands up as the representative for the proposed class. And basically, we as attorneys use their story to say, you know, Jane Doe purchased this product and this product that Jane Doe was defective in some way. And everyone else who purchased this product like Jane Doe was injured in the same way that Jane Doe was because they paid good money for a product that was defective.

Now, this leads me to the answer to your question, which is we as the class action lawyers, we need to find a person out in the public to be Jane Doe, the named plaintiff for us. And in that respect, we go out and advertise on our own website, showing lists of cases that we are investigating and ask people to write in if they are one of those people who had those products or bad services.

From those responses, we go out and we respond to people who have contacted us. And we proactively ask people who have reached out to us if we can represent them as a class representative. And hopefully, those people agree.

The next step is we put those people in a class action that we start as a named plaintiff. So that in a sense is the difference between a named plaintiff, a person whose name is actually in the lawsuit as a representative for the proposed class, and the general public, who are just potential class members. And once the court certifies a class, then all those people within the contours of what the court has said is a class, those people are then class members.

So the players are the plaintiff's attorneys, such as we, members of the public who help us by responding to us and offering to be class representatives or clients. And then once an attorney-client relationship is formed. Those are class representatives. And once we put their name in the complaint, they become a named plaintiff. And once the court certifies the class, the named plaintiff is the representative for all the class members.

Are There Benefits for a Lead Plaintiff in a Class Action Lawsuit?

Mike: A quick follow up. Does the named plaintiff have any additional benefits as a result of a typical consumer class action beyond what other class members would receive as a benefit?

Amey: Sometimes, it depends. The answer is it depends. The intangible benefit for the named plaintiff is to know what class actions could not exist without named plaintiffs. So people who are named plaintiffs are doing a societal good by standing up for all those people out there, like yourself who had unfair trade practices or misleading advertising or a defective product or had a data breach. So that's one benefit, but it's an intangible benefit.

The second way a named plaintiff could benefit, but it's absolutely not guaranteed, is sometimes the named plaintiffs, because they have to do extra work and supply documents to us and participate in the litigation. So there's extra work and extra risk because your name is out there in the public.

Some courts do approve service awards at the very end of the litigation, whether it be settlement or trial. Where basically a named plaintiff yet some extra money that is approved by the court. That basically says, thank you for serving as a named plaintiff, here is some extra money to reward you for the extra work you've done on behalf of the class.

And the reason I said that it depends is because it's definitely not guaranteed. It's something that we do ask for. The defendant usually agrees to some amount while we are trying to settle. And finally, there are some courts that will not approve that, or they will cut down the award. So really in the end it is up to the court.

Mike: How typical is it in your experience over the last year for a lead plaintiff to receive a reward?

Amey: In consumer class actions, I think it's safe to say there's a general range of a couple of $1000 up to in the high thousands. I think it's unusual to see more than $10,000. And I would say in the cases that I read and litigated, they tend to be in the low to mid thousands range for a consumer class action.

How Often Do Class Actions Get Settled?

Mike: In your experience, do class actions more often get settled or go through the court? Do they get settled or they are decided by the judge?

Amey: The vast majority of cases in general settle. And that is also the case for class actions. So the unequivocal answer to your question is the majority of class actions settle. However, there are a lot of settlements that happen as confidential settlements that do not involve a nationwide class. And therefore there's no information on them.

So we don't know those numbers. So there's a little bit of a black box because if there's an individual confidential settlement, we don't know what happened in terms of class actions that are actually litigated. And we can see them on case dockets.

Yes, the vast majority of all litigation, including consumer class action litigation settles.

What Is a Consumer Class Action Settlement?

Mike: What is consumer class action settlement?

Amey: In a nutshell, it is when there is either an actual class action that's been certified by the court or a proposed class action that hasn't gotten to that stage of litigation with the court yet, where both the plaintiffs and the defendant agree that it's better for both sides if there's a settlement before trial on a class or group-wide basis.

So it's not an individual settlement that's offered to each person individually, but everyone in the class for the purposes of settlement is offered the same terms of the settlement. So that could be any number of things. It could be a cash payment, it could be a coupon payment where you get a certain amount of money off towards the purchase of a new product. It could be a combination of both, but those are generally the kinds of things we see a cash reimbursement or a coupon or a combination of both.

Who Makes the Decision on Class Action Lawsuit Settlement?

Mike: Who makes the decision, whether there's a good settlement or not a good settlement, as it's offered by the company being sued? Who makes the decision? Is that the lead plaintiff who decides that this is good for the class or not?

Amey: So that also depends on the nature of both the case and the team of attorneys working on the case and the named plaintiffs in the case. So there oftentimes are very many named plaintiffs. So in a wide sprawling class action with many attorneys and hundreds of named plaintiffs, that answer can be very complicated.

But the simple answer is it's made in conjunction with a team of attorneys and the named plaintiffs, oftentimes in terms of strategic decisions and making the decisions that are best for the entire class and not just the named plaintiff. The lead attorneys ultimately weigh in favor of making the decision with the informed consent of the named plaintiffs as to what is the best settlement for the class.

In other words, one named plaintiff out of 50, if that person were to say, "No, I want more money." And that we're not to the benefit of the class and the other 49 named plaintiffs and everyone else out there. That named plaintiff is not necessarily going to be able to have veto power over an entire nationwide settlement.

That person also can opt out and make their own decision as to withdraw from that as well. So there are a number of considerations and it is a group decision based on strategic factors that the attorneys take into consideration as to what's best for the benefit of the class.

What If a Lead Plaintiff Withdraws from the Class?

Mike: So the lead plaintiff all of a sudden chooses to withdraw from the class. Yes, it's a problem, but it's not a big problem for the law firm that is running this case because you will just change the lead plaintiff and carry forward, is my understanding correct?

Amey: No, that's not at all correct. It very much depends on the litigation. But if there's only one named plaintiff, and if it's too late in the litigation to bring someone else in that could blow up the class action for all the plaintiffs.

So it is important that when people make the decision, whether or not to engage one of us class action attorneys to become a client and agree to be a named plaintiff, we do explain what those obligations may entail. But named plaintiffs do have obligations to the class and to participate and assist in the litigation. And it can be very problematic if a named plaintiff doesn't keep us informed or decides that they need to withdraw. It can be very problematic for the litigation.

What Determines a Valid Class Action Lawsuit?

Mike: What are the typical things when you intake the case, when you talk to a consumer initial conference to learn about the case? What are the things that are important to you as an attorney to determine whether this case is valid or non-valid? What are the parameters that you build into this picture?

Amey: There are two answers that I have to your question. And the first, I think you're asking, how do we decide to bring in a class action. And for that, we do a lot of research that involves talking to consumers.

Sometimes we hire consultants or experts to help us in that research. Sometimes we evaluate them on our own, and it's hard to make a generalization as to what makes a good class-action consumer class action because consumer class actions are so varied. It could be a product, it could be more of a tech issue, a data breach issue, or it could be like I said a service contract. 

So as a general answer, we're looking for a defective product, it seems to have a recurring, similar fact pattern where it seems like this is actually a defect that is widespread and similar among a class, people are having similar or experiences.

And then we do our own investigative research to try to ascertain what kind of defects that is. So in deciding whether to bring a consumer class action, we're digging into seeing whether a problem is widespread and common because that's the idea behind a class action, a group of people who are having the same problem, same or similar problem.

The second answer to your question is what are we looking for when we actually talk to someone on the phone as to whether they would be a good client, either for a class representative or just to provide us information in our investigation?

Again, that's hard to generalize because in a product case, I would want to know if they still have the product and the details of the way the defect manifested and in a services case. I would want to know things like, do you still have the contract and what was said and what was exchanged between you and the other person who is contracting your bank or whatever company who is providing the services.

But the short answer to that second question is we're generally looking for people who have something physical that we can look up to investigate and back up what the problem is, and allow us to evaluate the product.

If you're complaining about a services contract, and you deleted all your emails and don't have the contract anymore, we don't really have anything to evaluate your claim on.

If you have a defective product and you threw it away five years ago again, we don't really have anything to be able to examine your product and see what the defect was. So we need some sort of support to evaluate your claim.

How to Choose a Firm for the Class Action Lawsuit?

Mike: If a consumer thinks that they have a valid case, how should they go about which firm to pick? First, tell us which criteria consumers show in picking the right consumer class action.

Amey: Yes. That's a great question. Do your research. Obviously, you can go on the firm's website themselves and see what other kinds of lawsuits they have been involved in and the history of their experience in the particular kind of lawsuit you are interested in.

If you have a defective car and it doesn't look like that law firm has really done very many defective product or auto cases, that's probably not the greatest sign. Although there are great class action lawyers who are experienced litigators, who probably could handle your case. 

There's a lot of ins and outs in each industry. And you're probably well advantaged to pick someone who knows the ins and outs of how to litigate that kind of case. Our firm Berger Montague has been doing this for 50 years and we've been pioneers in antitrust and securities class action. And over the years we've developed a great record for our consumer class actions as well.

And you can see on our website, we've recovered over $30 billion for our clients. $30 billion is a lot of money that we have gotten for not only consumers but institutions that have antitrust violations as well. So we've been doing this for a long time.

We know the ins and outs of class action. We were pioneers in the field of class action, federal litigation from its inception and in its developmental stages. So we know a lot of those wonky legalese attorney type class action ins and outs that newer firms, those may be landmines for them.

How Do Websites Like PissedConsumer Help Consumers?

Mike: Amey, what do you think the value of a website like PissedConsumer, is to consumers?

Amey: Absolutely. So when we were speaking before about what members of the public can do to get involved in a class action, websites like Pissedconsumer.com and other consumer complaint websites are the way that members of the public can not only see if there are other people in their positions and maybe bring that to the attention of firms like us.

Not only that, but consumers can look for cases under investigation or pending, and that can be an information-gathering tool to then go look and see if law firms are actually pursuing cases.

The next step would be to contact those law firms like ours, and either offer information relating to your problem or if we're looking for a class representative or client to provide that information to us. The information that members of the public provide to us is immensely valuable in our pre-suit investigation stage.

And it also can be very valuable during the course of ongoing litigation because we get more information and that often helps us to secure a better settlement or to ask for more information we didn't know existed from the defendant in litigation. 

...websites like Pissedconsumer.com are an important intermediary step between consumers and plaintiff's class action lawyers.

We thank Amey J. Park for her insights and answers to top class action lawsuit questions. If you think your issue is valid for a class action lawsuit and you see many people with the same experience, it might be a good idea to bring it to the attention and seek help from law firms like Berger Montegue. 

You can browse reviews on PissedConsumer.com to see if other consumers have similar issues. Share your experience by leaving a review or a comment, then research if there’s a class action lawsuit that you can join. 

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